Chapter 13 bankruptcy Information articles can really just give basic guidelines set out by the codes of the Federal Court. To understand which type to file under is best left to a lawyer who specializes in this area of law. An interview about your circumstances and current obligations is often done at no charge.

Also known as, the wage earner’s plan, Ch. 13 can only be filed if you are an individual or small business owner. The business must not be a corporation or partnership, only self-employed or unincorporated are qualified. You must have a regular income that is large enough to cover your basic monthly expenses but not enough to cover your other incurred debt. There are maximum amounts for debt on unsecured and secured debt. These change to reflect the current consumer price index

Chapter 7 is another code under which individuals can file. This section may allow you to keep your home and car (if the values fall within the parameters), but other non-essential assets will have to be forfeited to the trustee. Under this code, you will be able to have all debt incurred (prior to filing), discharged, therefore, negating any further repayment.

The wage earner’s plan allows you to keep your home, car, and most if not all of your assets. The debt that you incurred prior to filing will not be discharged in the proceedings. Instead, the debts will be compiled into a payment plan set up through the court. Other debts that are allowed to be forgiven under this chapter are not forgiven in others.

Also, under the wage earner’s plan, you can may be able to stop foreclosure proceedings and catch up on past due payments. Other secured debt (not including the home) can be modified to extend payments over the life of this action. In effect, this may lower the payment. If you have co-signers on some of your secured debt, they too may be protected under this plan.

When you file under the earner’s plan, you are in fact consolidating all debt into one loan. You will no longer have to deal with individual creditors. Your responsibility will be to make one monthly payment to the trustee who is then responsible for distribution of the monies owed. The repayment will be a minimum of thirty-six months but no more than five years.

Chapter 13 bankruptcy Information can be confusing and amazingly detailed. This article is merely an introduction to the subject. For experienced and knowledgeable information, it is suggested you find a bankruptcy lawyer. Browse the internet to get more information, and to find a reputable lawyer in your area.

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